With countries grappling with the effects of the COVID-19 pandemic, increasing debts and a growing climate crisis, UN Secretary General, António Guterres, is calling for a level playing field for all involved.
In fact, he called on countries represented at the conference to make better choices, and to have more discussions in order to avoid repeating the mistakes of the past, and create an equal environment.
“We can make progress to end inequalities that hinder sustainable growth and prosperity for all. We can recover better together in this extraordinary moment in history,” he suggested.
The UN Secretary General was delivering the keynote address during the official opening ceremony of the first United Nations Conference on Trade and Development (UNCTAD 15) to be held in Barbados at the Lloyd Erskine Sandiford Centre, this morning.
Noting that the conference’s theme: From inequality and vulnerability to prosperity for all, captured the “heart of the challenge”, Mr. Guterres highlighted four main challenges, and warned that if not addressed they could make the notion of prosperity for all a distant dream.
He noted that the issue of debt distress, if left unchecked, could be a “dagger in the heart of global recovery because countries would be unable to “build back, if they were held back”.
“That is why at UNCTAD 15 I am proposing an urgent four-point debt crisis action plan. To start, we know that national budgets are stressed by COVID-19, so we must push immediately for an expansion of liquidity in the countries in greatest need. I welcome the recent issuance of US$650 billion in special direct grants by the International Monetary Fund. But this support largely goes to the countries that need it the least because it is distributed according to the quotas.
“Today, I am calling for a substantial re-allocation… to vulnerable countries that need them, including middle income countries,” Mr. Guterres pointed out.
The UN Secretary General also flagged the issue of debt service costs, suggesting that they could be suspended into next year, and made available to all countries, including those in the middle income bracket.
However, Mr. Guterres acknowledged that the suspension of debt payments may not be enough for all countries, and suggested the need for effective debt relief involving both public and private creditors.
“I renew my call for a comprehensive strategy around reforming the international debt architecture including debt restructuring for reduction, especially for middle income countries to help them avoid deadly cycles of debt waves. We should look at novelty debt instruments like debt swaps by banks and exchanges,” he proffered.
He also put forward a case to bring the public and private sectors together to develop novelty financing tools to accelerate the return of private investment to pre-pandemic levels, to accelerate recovery.
“The debt crisis action plan could ensure that no government was forced to choose between servicing its debts and serving its people,” the UN Secretary General stated. However, he told delegates that the first major challenge being faced was the need to build a global green economy.
Mr. Guterres noted that for countries like Barbados on the frontline of the climate crisis, building resilience was not a luxury, but an urgent priority.
But, the high ranking official charged that adaptation remained the neglected part of the climate equation, with developing countries most impacted by climate change receiving less than two per cent of the support given to developing countries.
“So, today I repeat my call to donors and multilateral development banks to allocate at least 50 per cent of their climate support towards adaptation and resilience. We need leadership. Countries cannot wait for others to make the first move. Developed and developing countries alike have a responsibility to act….
“It is time to shift our support to building a sustainable green economy,” Mr. Guterres charged.